A study of self-made billionaires reveals the key distinction between "producers" and "performers."
There are about 800 self-made billionaires in the world today. What enables this elite group to create truly massive value, and what can the rest of us learn from them?
John Sviokla and Mitch Cohen set out to answer this question with the first systematic study of 120 self-made billionaires, including extensive interviews with icons like Steve Case, Mark Cuban, and T. Boone Pickens Jr. The authors conclude that self-made billionaires aren't necessarily smarter, harder working, or luckier than their peers. The key difference is what they call the "producer" mind-set, in contrast to the far more common "performer" mind-set.
Performers strive to excel in well-defined areas, and they are essential to any company. But producers are even more valuable because they redefine what's possible, rather than simply meeting preexisting goals and standards. Producers think up entirely new products, services, strategies, and business models, with dramatic results.
This book offers fresh stories and insights into producers' habits of mind. It also provides corporate leaders with a new approach to selecting and managing breakthrough talent, and advice about innovation and value creation for aspiring leaders or entrepreneurs.
One of Business Insider's "15 of the Best Business Books Coming Out in 2015"
"The first billion is the hardest. I know from experience. If you are interested in giving it a shot, The Self-made Billionaire Effect is a good starting point. Great research. Great stories. Great opportunity."
-T. BOONE PICKENS, Chairman, BP Capital Management
"A fabulous profile of value creation that all organizations need to ponder as they build talent for the future."
-THOMAS COLLIGAN, former Vice Dean and Director, Aresty Institute of Executive Education, The Wharton School
"Fresh, provocative and insightful, The Self-made Billionaire Effect will challenge your thinking about how entrepreneurs succeed in creating mega-hit businesses. This is a racy read, where storytelling and personalities carry some important lessons to be considered and applied even for those working in stable and slower-growth businesses."
-DONALD J. GOGEL, Chairman and CEO, Clayton, Dubilier & Rice, Inc.
"This well-researched, fun-to-read book provides top management with a set of insights vital for finding and keeping the talent needed to design and deliver breakthrough value."
-LINDA A. HILL, Wallace Brett Donham Professor of Business Administration at Harvard Business School and coauthor of Collective Genius
"John Sviokla and Mitch Cohen have mined a rich vein-self-made billionaires-in an attempt to find common patterns. What I particularly admire is their nuanced insights: these men and women are not solitary, risk seeking, creative, overnight successes. They work in teams; they manage risks and rewards; they are as good at execution as they are at ideation; and they have been on roller coasters, not rocket ships. Their wisdom is invaluable for entrepreneurs and managers. I recommend it highly."
-WILLIAM A. SAHLMAN, Professor of Business Administration, Harvard Business School and coauthor of New Business Ventures and the Entrepreneur
"Massive success does require luck. But it also requires unusual ways of approaching problems. This is one of the most thoughtful books I've seen on what the outliers do to make it more likely their attempts will change the world."
-ASTRO TELLER, Captain of Moonshots, Google[x]
Whenever you find yourself on the side of the majority, it is time to pause and reflect.
Imagine what Atari might have achieved in the early 1980s if Steve Jobs had worked inside to develop the first mass-market personal computer? What might Steve Case have done for PepsiCo if he had decided to stay rather than join the gaming start-up that would eventually become AOL? Would Redken have been the first hair care brand to explode the market for salon-quality hair products if John Paul Mitchell Systems cofounder John Paul DeJoria had not been fired for his unconventional sales leadership style? Would Miles Laboratories have succeeded if it had pursued the idea posed by Michael Jaharis, then a young lawyer in its ranks, to proactively brand and market acetaminophen years before Tylenol became a household name? What if Salomon Brothers had kept Michael Bloomberg, or Bear Stearns had exploited the inventive ideas of Stephen Ross?
Jobs, Case, DeJoria, Jaharis, Bloomberg, and Ross, as well as Broadcast.com founder Mark Cuban, Celtel founder Mo Ibrahim, oil-and-gas magnate T. Boone Pickens, and scores of other extreme entrepreneurs all worked for established corporations before they struck out on their own. Some fled corporate constraints. Others were pushed out. Each one became a self-made billionaire. They all built businesses-in some cases multiple businesses-that are among the most iconic brands today. The influence of these and the roughly eight hundred other living self-made billionaires is so widespread that few people anywhere in the world can go a day without using, seeing, or in some way encountering the products and services they have created.
But what might their former employers have become if these exceptional value creators had decided to pursue and produce their ideas inside the organizations? Put a different way, why aren't existing corporations able to create massive value the way these self-made billionaires have? In so many cases, large corporations had the literal talent necessary do so-the self-made billionaires worked for them.
That latter question is top of mind for today's business leaders-smart, experienced, successful managers who are seeing their organizations pushed to the limits by rapid change. In today's environment all the base assumptions of how to build and sustain value are constantly in flux: What makes for efficient scale? Who are our competitors? Who are our customers? What do they want? Who owns what? Where is the risk? In a recent CEO survey conducted by PwC, more than half of the respondents predicted they would need to change their strategy either incrementally or wholesale in the coming years. Nearly 70 percent of those same respondents said they were concerned about talent issues, and 25 percent did not pursue a clear opportunity in the past year because they believed they didn't have the talent to take advantage of it.1 The fact that so many self-made billionaires held managerial positions in midsize to large firms before striking out on their own suggests that the survey respondents just might be wrong about this issue. They have the talent but haven't taken the time to identify or nurture it.
Taken together, these responses make clear that business leaders are uncertain about how to tackle the particular challenge of continually creating value in today's environment. Throughout their careers these leaders have taken care to cultivate and promote managers with sound judgment-that celebrated ability to see the world as it is and to make smart, strategic decisions based on reality. Judgment works best when the rules of the game are well established, when the variables are known. But what do you do in a changing world where the variables keep shifting?
To answer that question we decided to look more closely at the leaders and the businesses that have thrived in our era of constant change. Despite the challenges of the day, despite the apparen